Athene Winner

Insurer Athene entered the pension risk transfer business in 2017 and already is one of its top players. The PRT unit provides $9 billion, almost a third, of parent Athene’s asset inflows in 2023’s first half.

The PRT industry, where insurers take charge of defined benefit pension obligations from employers, is expanding rapidly, and Athene is a good part of the reason. In 2023’s first half, it did 45 PRT transactions. Most prominent was a deal in May with AT&T involving $8.1 billion in assets.

Athene, which private equity powerhouse Apollo Global Management acquired in January 2022, has been energetic in its moves to bolster its capital. In 2017, Athene created a reinsurance entity, for instance. Other PRT providers, notably Prudential Financial, have emulated this strategy.

Athene has been innovative in structuring transfers tailored to plan sponsors’ needs. For Bristol Myers Squibb, the insurer engineered a complex deal that gave the pharma company a means of hedging its assets during the transfer process, which can last as long as 18 months.

Further, Athene has no shortage of satisfied customers, as can be seen by its repeat business. Plan sponsors typically do PRTs for segments of their beneficiaries, such as current retirees, working employees in a certain age cohort, etc. Or they do different types of PRTs: buy-outs, where the insurer takes over all assets and obligations, or buy-ins, where the assets remain with the sponsor, to bolster its balance sheet and Athene handles payouts and other administrative chores. Lockheed Martin has done three PRTs with Athene since 2018; JC Penney, two; and Alcoa, four.

Finalists

• Agilis
• NISA Investment Advisors
• OneAmerica